Thursday, June 18, 2015 - The Judicial Panel on Multidistrict Litigation has certified lawsuits against Lumber Liquidators into an MDL centralized in the Eastern District of Virginia. More than 100 lawsuits were included in the multidistrict litigation certification, which aims to recover damages from Lumber Liquidators for toxic chemicals discovered in their laminate flooring.
The flooring that has caused legal problems for Lumber Liquidators allegedly contains formaldehyde, a toxic substance that becomes airborne in houses constructed with the materials in question. In certain cases, overexposure to formaldehyde can lead to cancer. The toxin is especially damaging for elders and children exposed to the substance.
The initial investigation into the source of the formaldehyde was conducted by the television series "60 Minutes." The show sent reporters over to a Chinese warehouse where the flooring was being manufactured and discovered that the materials were filled with toxins. Homeowners who had purchased and installed the flooring began filing lawsuits around the country after the "60 Minutes" report, claiming that they had suffered from the toxins that had been escaping from their Lumber Liquidators flooring. Plaintiffs have complaints of fatigue, shortness of breath, and other ailments allegedly linked to the flooring.
Plaintiffs are claiming that the amount of formaldehyde discovered in the flooring is 10 times more than the levels allowed by California state laws, where much of the testing was conducted. The Environmental Protection Agency does not have hard limits on how much formaldehyde is allowed in building materials, although they are currently working on a bill that will do just that. It is expected to be published sometime this year.
Plaintiffs have also claimed that the flooring hurt the value of the homes. In addition to the health risks posed by the toxic flooring, homeowners involved in the lawsuits say that their homes are "markedly less valuable" now that the news concerning Lumber Liquidators and their manufacturers has gone national.
Lumber Liquidators took to testing the flooring of customers in maneuvers made before the MDL began and discovered that 97 percent of homes they inspected were below acceptable levels of formaldehyde pursuant to guidelines set by the World Health Organization. Even if the test results are encouraging, much of the damage has already been done. Lumber Liquidators stock has fallen close to 50 percent in 2015 in large part due to the formaldehyde issues.
Lumber Liquidators announced in May that it would suspend the sale of laminate flooring manufactured in China. The company however did claim that the toxic flooring that was sold to U.S. customers was labeled as safe and in line with the formaldehyde level expected. The "60 Minutes" report discovered that workers at the Chinese factories were adhering false labels to the flooring they supplied for Lumber Liquidators.
The flooring in question has been sold to more than 1 million customers in the U.S. already. The breadth of the violations allegedly made by Lumber liquidators has spurred the possibility of criminal charges in addition to the MDL filed by the Department of Justice. The DOJ is considering filing charges claiming that Lumber Liquidators used illegally sourced products, which is illegal under the Lacey Act.